Trade Analysis: As Gold Goes, So Should Bitcoin

Authored by GoldFix, ZH Edit

Select Subsections: (1300 words)

1. Introduction: Bitcoin as a Trade, Not a Belief System
2. Cup and Handle: Why Technical Analysis Matters Here
3. Second Reason: Reduced Clearance Time for Shorting Bitcoin
4. Gold’s Fingerprint and Its Influence on Bitcoin
5. Macro Picture: Climbing Bond Yields and Inflation Response
6. Zoltan Pozsar’s Insight on Fighting Inflation
7. Bitcoin’s Path Forward: Institutional and Sovereign Buying
8. Final Note: Bitcoin and Gold as Reflections of the Anti-Goldilocks Era
9. Bonus: Bank Analysis

What is This Post?

Recently Bitcoin has had several events from different disciplines converge in bullish fashion.

1) Market Structure (new clearing rules),

2) Eventwise (Trump Election, MSFT),

3) Secular (Anti-Goldilocks), and

4) Fund Flow behavior ( Mac-D fund rules)..

5) Technically, an apparent Cup/Handle formation triggered

Most of these things happened slowly over the last 3 months. The cup/handle formation gives the risk/reward not unlike the one Gold just demolished to the upside.

So, a trade was put on (with plenty of room for profit and loss) worth sharing. The parallels to Gold listed above are striking on a technical, fund flow, and secular level. The asset specific reasons (Market structure, Trump Event ) are the wild cards. Win or Lose here is the recipe.

Introduction: Bitcoin as a Trade, Not a Belief System

This is a trade about Bitcoin—pure and simple. Not about asset class comparisons, monetary theory, or any gold-standard analogies. I’m long on Bitcoin strictly for trading purposes, not for making any ideological or “religious” statements here.

Rationale for Increasing the Position

When Bitcoin crossed the 73,000 mark, I expanded my position by 33%. Why? Two reasons. First, I saw what looked like a solid cup-and-handle formation—something that also came up with gold. Now, I’m no technical analyst, but I respect technical formations for their risk-reward insights. Technical analysis isn’t about mysticism; it’s about setting clear numbers and managing risk.

Cup and Handle: Why Technical Analysis Matters Here

Let’s be clear: technical formations are useful for defining risk-reward, even if they’re not all as classic as “cups and handles” or “head and shoulders.” I tend to see patterns like Vs and Ws, not the standard textbook stuff. But with Bitcoin, this breakout above 73,000 looked like a textbook cup and handle—a signal to act.

Gold’s Cup and Handle level estimates….

Second Reason: Reduced Clearance Time for Shorting Bitcoin

The second reason I went long was the reduction in clearance time for Bitcoin from three days to just 12 hours. That’s significant. It means shorting Bitcoin becomes harder—similar to what’s been done with gold and silver in terms of holding prices down through rehypothecation post Basel 3 passing. Essentially, Bitcoin’s availability for shorting becomes restricted, just like in precious metals markets due to the BRICS calling back their collateral.

Acknowledgment to Early Indicators

Hat tip to Tyler Durden ( Not ZeroHedge TD.. his X/Twiter handle.) for spotting this BTC clearing time change early. He recognized the issue on the “bleeding edge” and was quick to highlight its impact. Knowing this, I felt better about the technical call on Bitcoin.

Bitcoin’s Cup and Handle formation is just breaking out…

Gold and Bitcoin: Parallels in Market Behavior

This technical setup in Bitcoin reminded me of what’s been happening with gold. There’s a rhythm here—almost like gold and Bitcoin are syncing up in cycles. Look back to 2020: Bitcoin rallied along with tech stocks and inflation, then both backed off in unison. Now, gold rallied again, and Bitcoin appears to be following suit. On a quarterly or yearly view, the parallels are hard to ignore.

Big Players’ Influence: MACD and the Bond Vigilantes

One of the early signs  noticed in gold’s rally was the behavior of large, discretionary macro funds, or what you could call the “MACD crowd.” These aren’t algorithm-driven funds; they’re the heavyweights of speculative finance, acting independently but based on strict quantitative criteria. When an asset makes a new high on a major moving average or quarterly basis, they step in.

Bitcoin Target Concept …

 

Macro Picture: Climbing Bond Yields and Inflation Response

Zooming out, bond yields are climbing even as Powell cuts rates, reflecting a broader strategy to combat inflation. There are two ways to fight inflation: raising short-term rates, which curbs demand, or letting long-term yields rise, signaling the market to adjust. With long yields rising, inflation concerns drive higher asset prices.

Zoltan Pozsar’s Insight on Fighting Inflation

Two and a half years ago, Zoltan Pozsar mentioned the need for a “Volcker moment” to truly tackle inflation. He implied letting markets become more volatile and allowing bond yields to climb, which is happening now. Bond yields have risen, and volatility has returned. It’s clear that the Fed is stepping back, letting inflation be countered by long-term bonds.